The extent of the success of businessmen from South Africa is not always appreciated by South Africans. Most people, for example if they heard the name Richemont, would understand that it is a South African company, and some might even know that it is run by Johann Rupert, but they really would not know the whole range of companies that this South African company owns throughout the world.

It makes 52% of its money from jewellery but they are also specialist watchmakers, not to mention the Mont Blanc range with its pens. Anyway, to keep this blog short, I will just list some of the brands that they own: Cartier, Baume and Mercier, IWC – they make extraordinary watches or at least my favourite watch, Piagut, Ralph Lauren watches and jewellery, Mont Blanc, Alfred Dunhill, Chloe, Net-a-Porter and Purdey.
That is about half of the companies that Richemont owns and it is no wonder that, despite a tough economy around the world, there operating profit rose 51% and their sales increased by 29%, because they really are involved in top quality products.

What happens overseas is often very important to us, because politicians and law-makers don’t need to reinvent the wheel every time they come up with new laws. It is far easier to study overseas jurisdictions, and see what they have done, and implement things. The legislative move normally starts in some of the more liberal democracies such as the United Kingdom or America, and then it gets slowly but surely copied to nations and countries all over the world.

From that point of view it is very important to sense the growing move when it comes to tax affairs that is developing in these countries, with complaints in America that Mitt Romney is not paying enough tax and in the United Kingdom they have now reached the point where the Prime Minister has basically said that he feels that anybody who pays a handyman or worker at home in cash is ultimately crooking the system. They are well aware that those people that they are paying, be it your taxi driver or a worker, are not usually paying tax. In some regards this is met with howls of outrage with people naturally arguing that they can spend their money how they wish – whether in cash or via bank payments – but the flipside of the coin is that until everybody is brought into the tax system and pays their fair share of tax, those of us registered on the tax system will end up paying more because of the tax that could be collected, albeit in small amounts, from hundreds of thousands of people who are not paying their share and are avoiding coming clean into the system. The message is accountability and if you want to pay less tax ultimately, you have to ensure that more people in the society in which you live pay their fare share of tax because if they don’t, it’s going to be you with your tax number and being taxed on your salary is ultimately that you are going to foot the bill for the tax cheats.

It was good to read, in the Reserve Bank governor Jill Marcus’ decision to drop rates by 50 basis points, that inflation is expected to go down, touching 4.9% next year. Economists like to make everything sound fancy and so when they say 50 basis points, what they really mean is 0,5%, so they turn 0,5% into points and then call it 50 points. I don’t think people thought for a long time that we were going to get another interest rate drop, and I certainly don’t think there are many to come, so people really need to use this as an opportunity to reduce bonds on properties, pay off the motorcar and reduce their debt, because somewhere along the line the interest rate cycle is going to start heading up, and those who have indebted themselves at this time, when interest rates are historically low, are going to be squealing – but it is quite predictable and something that one should prepare for and whether it takes 1, 2 or 5 years for interest rates to head on up, they most certainly will ultimately.

The serious news about the various US agencies investigating Lance Armstrong for doping is worrying for anybody who has watched the Tour de France over the years. Cycling has had so many problems with drug cheats and so many winners who have later been declared not to have been the winner, but the last thing they can afford is that the man who has won the Tour de France more than anybody else, turns out to have won it on illegal substances as well.

I certainly would prefer to believe the story of a cancer survivor who fought back and won against all odds and then dominated in the Tour de France. One has to think however, with most of his former teammates aligned against him and ready to give evidence, and the persistent rumours that simply have not gone away for years that he is a drug cheat, there may be more truth in it than most of us would like to believe. He and his lawyers have certainly fought off every challenge so far but they have not faced one like this and from a lawyer’s perspective, when you start hearing about a case where he is trying to set aside decisions to investigate him and saying that he will not get a fair hearing, it just sounds like there is something to hide.

There has been a lot of criticism of the golf world rankings over the years, saying that they are not really accurate. For example, somebody winning a minor event in Japan, with not many ranked players present there, can get as many points towards world golf rankings as an event in America, which has more than twice as many Top 100 players.

Two Professors, Broadie and Rendleman have now come up with a new study, suggesting that rankings should be set according to the ratings of the players taking part in a tournament and also on how those players do, when they go head to head in a tournament and play against each other. They give as an example in their system Yuta Ikeda and Nick Watney. They both had similar ratings in the official rankings in 2010 but on their system they would be 78 places apart. When the two of them were in the same tournament, Nick Watney had finished with better scores 10 out of the 12 times they played together and against that background they would be saying that to say, as the world rankings do, that the two players are similar is incorrect and that is why the official world golf rankings require a revision.

Players who travel to, and win bizarre events, such as the Golf Nippon Series Cup or the Singapore Open, the Madeira Islands Open or the WGC-HSBC Champions Event, end up earning far more world rating points at the moment than scientific methodology indicates those tournaments should have been worth. Hopefully we will see an implementation of a new system in the future and we will see some changes in the rankings.

The UK government has recently announced plans to introduce new laws to target what they call “Cowboy tax advisors”, and businesses and celebrities that use aggressive tax avoidance schemes. These new laws will empower their revenue and customs services to force tax firms to reveal, who amongst their clients, use aggressive tax avoidance schemes as has recently happened where a comedian and members of pop groups claim that they actually work offshore, and as a result pay almost no tax at all. This is despite living and performing in the country.

Basically they set up a company, based the company in an offshore location and then say they are working for that company earning a minimal salary and the company earns all the profits in a location where little or no tax is paid. Embarrassing the firms, or the pop stars for example, is likely to isolate them from either their customers or their suppliers because nobody wants to give business to somebody else that is basically ripping off the public and also effectively competing unfairly with other businesses. When a company does not pay its fair share of tax, or pay staff for example, without deducting tax, and sometimes staff being paid higher salaries than they should be, it is also unfair competition with their competitors. 

There is no doubt that whether you are a critic of Tiger Woods or a fan, you will concede that at the moment his short game is not what it was. His sand save statistics are very poor, he misses puts that he never missed before and despite that, he has already climbed to No 3 in the world golf ratings, and on current form there is no doubt in actual fact that he is the best player in the world. He is the first player to have won three events on the toughest tour in the world, the US PGA Tour this year, and he is winning an extremely high percentage of the tournaments he turns up at. All of that, despite the fact the he is clearly not at his best. His performances this year have already embarrassed all of those who subscribed to the “he is finished” group, and if he can produce the results he has, without having those parts of his game that he used to be able to rely on, there can be no doubt if once he’s had more time to practice on his short game, his bunker shots as well as his putting, is going to dominate golf again other than the usual problems of injuries.

Not only do we pay excessive rates in South Africa for mobile phones and cell calls, but we appear to put up with shocking service. It is almost impossible to get a signal along William Nicol, for example, during peak hours, but even if you drive along it out of peak hours, you will get one dead spot after another.

This is a major road, in what is the economic capital of the country, where all of these cellular providers base their head offices and yet you can know with precise certainty the exact points where you are going to lose your phone call, and then have to call again if you are outside peak hours, because once you are in peak hours, you will not get a signal to make a call in the first place! It really amazes me what we have to put up with, at five times the cost that everyone else is paying for it.

The Open is one of the four golf Majors and it begins today at Royal Lytham and St Annes in Blackpool, which is on the wets cost of England not far from Liverpool. I will bore everybody if I again back Tiger Woods, but I do think he will feature well. He is the in form player of the last few months even if he is still not back to his best.

Majors ultimately get down to the mental approach which means the vast majority of the field will simply eliminate themselves under the pressure. The tournament will be won by someone who has won recently as like many things, winning is a habit in golf and somebody who does not have that habit and is not able to deal with being in the lead, is unlikely to win.

America is one of the first countries where the Universities really starting pumping out law students, as is now happening in South Africa, and that is now resulting in salary slides.  In fact, they say one of the reasons that salaries having slid even more than they should do, is that companies are afraid of losing face if they reduce the salaries of attorneys too much. 

Other things that the companies complain about, to quote the New York Times, are “Talk to just about any partner at any major law firm, though, and they will tell you that first year associates know basically nothing when they start out.  Plus, a tiny fraction of the new grads they hire and train intensively actually stick around to become partners 7 or so years later.”  The benefit though is that those earning the top salaries in the major firms who are expected work 80 to 100 hours a week but those on the lesser salaries and new attorneys, while earning considerably less, mainly work 40 hours a week, which is considered to be the absolute minimum amount of work that a lawyer can do.  In my own experience, lawyers in South Africa typically, apart from those in the bigger firms, don’t work very much more than 40 hours, so I think most attorneys would struggle to keep up with working double that a week.  Personally, I typically work about 60 hours a week, but I guess that is expected that a company boss would work longer hours.

My recent trip to London for a client’s case revealed that the preparation for the Olympics is well and truly under way, but not possibly in the way that South Africa would expect. Whereas we were expected by the world to build brand new stadiums in every city, even in cities that clearly did not need huge stadiums, London is only building one major new arena, being the athletics stadium.

The rest of the structures, and they are going up all over London at the moment, with Greenwich in particular having a number of events such as equestrian and archery, are all basically portable structures that have been wheeled in by trucks and erected, and will be taken down straightaway after the Olympics. After watching South Africa’s efforts, I was somewhat stunned to see this, but on the other hand it is apparently the first Olympics sports event in recent years, in any country in the world, there is way too many comments that has come in under budget and that is most probably why – because they are not going to have a legacy of huge stadiums that can only be filled if a rock start performs a concert and typically rock stars don’t go to Nelspruit.

In England they have decided to start a guide for people, going through a divorce, as to how to deal with their divorce amicably. The government is giving over R150 million towards groups to create many support services for parents who are separating and the advice will include tips on how to avoid arguing in front of children, how to sort out child support payments and how to cope with meeting your ex’s new boyfriend or girlfriend. Help will also include specific help for wives dumped for younger women, advice on how to deal with stepchildren and all of the reforms are basically aimed at making it best for children.

BlackBerry is now planning to break itself into two, after some time of declining profits, having recorded a loss. They are planning to sell their handsets manufacturing division, because it is really doing badly and then try and find a separate buyer for its messaging network, which is its real asset.

The share price is down from $148 Canadian in 2008 to $10 last week and so if you had invested in BlackBerry, you could by now have lost more than 90% of your money. Four years ago BlackBerry has accounted for more than half of all smart phone sales, but now they only have 10% of the market. RIM (Research In Motion), the BlackBerry owner, could also make a lot of money by opening its secure network up to rivals such as Apple and Google and allowing them to use it as well.

An idea that I certainly hope takes off in South Africa is Giff Gaff. Giff Gaff, whose website is at giffgaff.com, is a mobile virtual network operator running off the O2 network in the United Kingdom. Basically, while using the network it allows itself to be user driven, so there is not very much support, but the payback is that the data and phone call packages are considerably less than what you would pay on the High Street, or directly even from the parent company, O2 itself.

This business has won numerous business awards in the United Kingdom including the most innovate community award and they were one of the finalists for the marketing society’s brand of the year during their first year of operation, 2010. You can only top up your account by using the UK credit or debit card but for example for £20 or R260,00 a month you could get the following package: 800 minutes of calls per month, unlimited text (or what South Africans call SMS’s) and unlimited Internet and data for the month!

It is always, as a racing fan, good to see top horses and if you get the best horses in the world to race meetings, you will draw the crowds. Royal Ascot, about 45 minutes outside of London by train, recently had the two best horses in the world competing in the same 5 day meeting.
Frankel is the highest rated horse in the entire world, with a rating of 140 and he won his race by over 11 lengths and then on Royal Ascot on Saturday, it was the time of Black Caviar, the unbeaten filly from Australia. The jockey appeared to underestimate where the finishing post was but she still held on for her 22nd consecutive victory of her career, and has never ever been beaten.

You would not think, at prices of approximately £40 per ticket to get to the race, that you would get a sell-out crowd, but they did of more than 77 000 people with the result that I, who wanted to book the day before, could not even get a ticket to be there in the flesh.

It is always great to read what the executives are being paid, because it is always nice to have something to dream about, however far out of reach that dream seems!

The CEO of Vodacom, Pieter Uys, has just had a 25% increase, because the profits of Vodacom apparently increased by 25% and his salary, benefits and bonuses total R16,5 million for the last year, by comparison he earned R13,2 million and even the former Managing Director, as part of his remuneration, got a sign-on payment that left him with R8,6 million for the 7 months of the year that he worked at Vodacom. Quite clearly, there is a lot of room to cut call costs!

I have written a lot about the live traffic feature of the TomTom GPS unit, but I have subsequently been told that Google have added traffic coverage to Johannesburg and Cape Town so that Google Maps now too have live traffic. One can access the live traffic by going to the Google Maps page at maps.google.co.za and on the right-hand side of the screen enabling the traffic feature. Obviously, the information will become more accurate as more people use Google Maps to drive or Google Navigation while travelling.

While it is quite useful, and free, I don’t think it is anywhere near as sophisticated as the information you find on the TomTom which would give you specific estimates depending on which direction you are travelling in. This does not do that and instead it simply gives you a line in green, for example, indicating that the traffic is fast or a black and red line to indicate that it is extremely slow. The TomTom system takes into account the various amounts of traffic on various routes and then advises you which way to go to save the most time on your journey.